TOYOKAZU KUBOTA has somehow been destined for Central Europe: he is fluent in Czech and spent more than a decade in Prague. Diplomacy also brought him to Hungary, though he says his Hungarian goes only slightly beyond “jó napot” (hello). Currently, Toyokazu Kubota serves as chargé d’affaires at the Japanese Embassy in Bratislava and says that Slovaks’ interest in Japan has pleasantly surprised him.
The Slovak Spectator spoke to Kubota about the challenges of the Slovak business environment as seen through Japanese eyes, Slovakia’s worries about Japanese investors moving further east, the challenge of the ageing of the population and education reform.
The Slovak Spectator (TSS): What are the greatest challenges that Slovakia’s business community faces, as seen by current Japanese investors? Some countries further East already offer even cheaper labour and more attractive tax incentives. What are the challenges for the countries of the region if they wish to remain competitive?
Toyokazu Kubota (TK): In Slovakia there are already 44 Japanese companies, of which 17 are production firms and 27 are trade companies. Japanese firms employ over 15,000 Slovak workers. Japan has been trying to achieve the highest possible investment in Slovakia, mainly in the electro-technology and automotive sectors.
Yes, Slovaks sometimes worry about the prospect of Japanese capital moving further east. However, countries further East, even those which might offer cheaper labour, do not always have the infrastructure, which is very important for Japanese investors.
Also, once the Japanese invest in a country, they understand it as a mid- or long-term investment. Japan is not interested in ‘pirate’ investment strategies: short-term investment at maximum profit. In this sense you can trust us and rely on us.
For Japanese investors, the living conditions of their workers in a foreign country are very important. In Slovakia, they still face some difficulties. I will mention one example: drivers’ licenses. Previously, we were able to switch the Japanese driver’s licence to Slovak, but since Slovakia’s entry to the Vienna Convention on Road Traffic, it is no longer possible. Before, we only had to submit a certified translation of our driver’s license, but the process now is more complicated. Of course, we can apply for international drivers’ licences, but these need to be renewed each year, which complicates the life of Japanese in Slovakia.
We have been waiting for the transportation law to be revised, which is a huge legislative measure, while the paragraph pertaining to drivers’ licences is only a very small part of it.
We still see large investment perspectives in Slovakia. Your country is close to other countries of the EU.
TSS: In your opinion, how successful have Slovaks and Japanese been when it comes to crossing cultural barriers?
TK: Each Japanese company has been trying to become familiar with the locals. It is our way of doing business. We do not care only about profit - we also try to learn about the culture and locals at the corporate as well as the national level. We also send Slovak employees for training in Japan. Of course each company tries to instil Japanese work discipline, since our business focuses a lot on deadlines and precision. Perhaps some Slovaks might say that there are Spartan conditions.
We prefer collectivism over individualism and we do prefer collective discipline.
Of course, we are trying to transplant these things to Slovakia, but we are also open to the Slovaks. This can help the nations to get closer to each other and mutually understand and enrich each other.
TSS: Has the language barrier been difficult to cross?
TK: Japanese businessmen do not necessarily prefer Japanese-speaking employees. If one speaks English it is really enough in terms of being able to communicate. For Japanese managers, people’s characters and work habits are far more important.
TSS: Are Slovaks interested in Japanese culture? What aspects of Slovak culture are interesting for the Japanese?
TK: In Slovakia there are a number of people who are interested in Japanese culture. A lot of people are training in traditional martial arts or sports. For example, judo is already well-known in Slovakia. I have already seen a judo tournament and though it was a junior tournament, they trained in the same way as the Japanese. It is not only sport, but also the Japanese lifestyle, which is the most positive interaction between the cultures. I was pleasantly surprised by the interest of Slovaks in Japan.
TSS: Japanese people are known as travellers who are extensively interested in cultures all around the world.
TK: The Japanese are curious about the world, which might be determined by our geographic location. We opened up our country to Europe and North America only a hundred years ago. We always had interest in neighbouring cultures such as China or India and our culture is a hybrid of Chinese, Korean, and Indian civilisations.
These countries have very significant cultures and our predecessors tried to import all that and gradually apply it while incorporating it into their own culture.
It is the typical Japanese process of absorbing other cultures or civilisations. And of course we have applied this process also when accepting European and other countries. Perhaps we are more flexible in this process, and this might have helped us in our efforts.
This might be one of the reasons behind our people’s interest in travelling abroad; however,
these travels have always had financial implications, and it has not always been possible for an average Japanese to travel. But today every Japanese citizen can afford to travel to some Asian country.
TSS: According to a recent survey by Dentsu, young Japanese have a tendency to focus on domestic destinations and domestic trademarks. Is there such tendency and if so, why, in your opinion?
TK: The number of Japanese tourists in Slovakia has been gradually increasing. Of course not dramatically, but still increasing. When a Japanese tourist visits Slovakia, it is usually part of a trip that includes the Czech Republic, Hungary and Austria because these trips are financially demanding. I personally have not noticed that young Japanese travel less than they did before. The financial limits enforced by the global crisis might play its role. I do not think that the interest of young Japanese people in Europe or the Central European region has been dropping.
TSS: European countries have been facing the problem of an ageing population while trying to revise their pension systems. How has Japan been dealing with the problem of its ageing population? What is Japan’s experience with reform of the pension system?
TK: In 2008 in Japan the number of elderly people stood at 22 percent. In comparison, back in 1994, we had 7-14 percent and in 2007 it was 21 percent. Based on one of the predictions, in 2020 the number might stand at 29 percent and by 2050 it might even climb to 40 percent.
Our government is dealing with this problem very intensively and right now we are in a sort of
In the area of the pension system there is a problem in the area of contributions, which the younger generation pays. We understand it as solidarity between the generations: simply, the young people pay to support the older generation. However, this pension system is now disintegrating. The young people no longer want to contribute and the number of young people is also shrinking.
So now we have to replace the financial basis of our pension system, which is a huge undertaking. Now we are starting to talk about increasing the value- added tax (VAT), which is currently 5 percent for all goods. And the government is also talking about allocating this tax to social issues, so the VAT would be used solely to cover social payments. Many people retire at the age of 60, but most of these try to find another job so that they can support their family or children. Also, at the age of 60 most people are very active and they do not want to stay at home and they want to earn something to cover their hobbies.
As far as care for older people is concerned, traditionally, sons were expected to care for their ageing parents. But young people can no longer afford to care for their ageing parents, which also brings along a number of problems, because then the state has to do it.
We also have to train social workers and nurses, but it is a very demanding job and our young people do not want to do this job for the very low pay it offers.
These developments are linked to easing our immigration regime, and Japan is starting to accept a certain number of citizens from other Asian countries so that they can compensate for the Japanese in the area of social care.
In other instances, the Japanese were able to follow the example of the United States or Europe in seeking solutions to different problems. As far as the ageing of the population is concerned, there is no ready-made recipe and we have to try to solve it.
TSS: Slovakia lags behind in linking academia with business in order to ensure that the education system serves the needs of the business community. What is the situation in your homeland in this area? Is the Japanese educational system interconnected with the needs of the business?
TK: No, it isn’t. We only now have realised the need for this connection. Until recently, academic institutions lived in their Ivory Tower and rejoiced in their lonely fame.
Also, according to traditional ethics, academics cannot be involved in money-making activity because it goes against traditional morals.
Now, in this time of globalisation, many point to the fact that Japanese students are falling behind in comparison with Chinese and Korean students. Our government started thinking about the reform of education system with one of the objectives being a tighter interconnection between academia and industry.
Up until now, the aim has been to maintain the highest possible level for all students. But if we want to remain competitive internationally we too must have exceptional minds in, for example, the development of technologies.
As for Japanese students going abroad, it is now almost a trend that students take a year off from their own universities and go to study English at US schools. I was born in 1954 and studying at a foreign school seemed a complete luxury to me. For the Japanese youth today it is a normal thing. As for academic cooperation with Slovakia, there are 19 types of cooperation between Slovak and Japanese schools, and both sides are trying to use this cooperation for their benefit. However, the countries are separated by a rather large distance and thus finances sometimes create barriers.
TSS: Energy sufficiency and energy safety are currently two of the most urgent issues that many European Union countries face. What are the challenges and options for Japan in this area? Is nuclear energy one of the options? If so, what are the challenges it brings?
TK: Nuclear energy accounts for one-third of the electricity produced in Japan. However, we have a lot of problems associated with nuclear energy. We have to secure the safety of our nuclear power plants and diversify sources of uranium. This is why we have recently signed a contract with Kazakhstan on cooperation in the area of nuclear energy. We also have to diversify our sources of oil not only in the Middle East but also from other countries.
We are researching oil reservoirs around Sakhalin but there we have unresolved territorial problems with the Russian Federation. We also have some territorial issues with Korea and China concerning some small islands. They have huge interest precisely because oil was discovered around them. We will have to reach an agreement and set the borders between China and Japan and Korea and Japan. We hope that we can create a joint project for oil extraction.
TSS: In the Global Peace Index's ranking of the state of peaceful coexistence in each country, Japan is among the top five countries. In the first study of its kind, worked out by the Economist Intelligence Unit (EIU), 121 countries were assessed. There were 24 indicators taken into consideration concerning the state of peacefulness in a given country, including, for instance, the crime rate, military expenditures, the state of democracy and education. How has Japan achieved such a good ranking?
TK: The ranking pleasantly surprised me. When we look at Japan’s historical development, about 400 years ago, during the unification of Japan, the overlord collected all the arms from the peasants, and from then on the peasants did not own weapons. Of course the move was intended to make sure that the peasants did not revolt against the Samurais, and since those times only the Samurais have worn guns. Perhaps this also had some pacification effect on the peasants, who made up 80-90 percent of the population.
However, we also cannot overlook World War II, when we learned the hardest lesson of all history: the fact that wars lead nowhere. Japan has modified its constitution to ban the use of armed forces for attacking others. The military can be used only for defence, and this has also had a pacifying effect on the Japanese.
Marta Ďurianová contributed to the report.
Political system: Constitutional monarchy
377,835 square kilometres
Japan consists of 47 prefectures. Government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defence allocation (1% of GDP) have helped Japan to become the second most technologically powerful economy after the US and the third-largest economy in the world after the US and China.
Source: CIA Factbook